Posts Tagged ‘shipping’

Okay, maybe just a peek. After yesterday’s 1,000+ rout, and at last count, it was heading back north, slowly but surely.

But if you’re a long-term investor, you shouldn’t play these peak and valley games, right? Stop paying attention to that ticker and get back to work!

As for getting back to work, guess who’s getting into the delivery business? I’ll give you one guess.

No, not Domino’s pizza (at least not yet). Amazon!

The Wall Street Journalreported this morning that Amazon.com is preparing to launch its own delivery service for businesses, putting it in direct competition with UPS and FedEx.

No, to answer your inevitable question, there is not a single business or industry won’t consider entering and disrupting.

Amazon’s push into logistics reflects its growing ambitions across a wide range of new businesses beyond online retail. The company runs a dominant cloud-computing services division, a Hollywood studio and a massive marketplace and logistics operation for sellers. Last year, it acquired Whole Foods for roughly $13.5 billion, transforming it into a brick-and-mortar grocer overnight.

The new service will be called "Shipping with Amazon," and will have the company picking up packages from businesses and shipping them to consumers.

It is the latest move by Amazon to create its own freight and parcel delivery network. In the last couple of years, Amazon has expanded into ocean freight, built a network of its own drivers who can now deliver inside homes and leased up to 40 aircraft while establishing an air cargo hub.

But as the Journal story reports, there’s steep (and deep-seated) competition from the incumbents:

It remains to be seen whether Amazon can successfully deliver packages for other businesses on a broad scale. UPS and FedEx have built out massive networks over the course of decades to allow them to deliver across the U.S. And it is expensive. UPS this year alone is​ ​planning to spend up to $7 billion on upgrading its delivery network.​

In a related story yesterday, Amazon said it would begin delivery of Whole Foods groceries via its "Prime Now" service. Shortly, Whole Foods’ customers in Austin, Dallas, Virginia Beach,a nd Cincinnati will have the option of one – and two-hour grocery deliveries.